August 23rd, 2012
in Gary's blogging
Opening Market Commentary For 08-23-2012
Premarket averages started falling at 7 am and when the financial report of the Initial Jobless Claims came in the SP500 futures dropped another 4 points to 1407.64. It remained there until the opening bell where the 500 melted down to 1405 on low red volume.
Looks can be deceiving, but it appears, just by the low volume, to be another slow day in the making. Normally by 9:45 we are in the midst of heavy trading going one way or another but with low volume it is not very exciting. Lacking human traders, the HFT crowd just meanders the markets up and down according to some obscure algorithm.
Yesterday towards the session end the 'BTFD dippers' jumped into the market and pushed it up fractionally where them markets closed flat and mixed. Today, right now, we are back to yesterday's lows and your position is in jeopardy of being unprofitable very soon. Baring any really negative news I suspect we will see the markets melt down and then melt up; no waterfall today.
Market Unhappy With Initial Claims Miss As 1.3 Million People Fall Off Extended Benefits In Past Year
One month of positive economic surprises since the last FOMC may be all we get, now that a "majority" of FOMC members suddenly need a rapid deterioration in economic data to usher in the NEWER, MORE OPEN-ENDED QE. Initial claims was happy to comply: after posting several weeks in a row of "beats", claims has finally resumed "missing", as well as rising, posting an increase from last week's upward revised 368K print to 372K this week, worse than the expected improvement to 365K, and to a one month high.
The RRR** looks again this morning to be narrow and probably unprofitable. Swing trading is at your own risk and being the market is at a crossroads of sorts, I would prefer to sit on my hands rather than risk guessing incorrectly. It appears to be bearish, but we have been here before.
The DOW at 10:15 is at 13078 down 97 or -0.74%.
The 500 is at 1404 down 9.47 or -0.67%.
The $RUT is at 806.93 down 5.66 or -0.70%.
SPY is at 140.86 down 0.97 or -0.68%.
The trend is sightly bearish and the current bias is down.
WTI oil is at 97.54 trading between 97.25 and 98.30 and the bias is negative.
Brent crude is at 115.82 trading between 114.95 and 116.38 and the bias is negative.
Gold is at 1664.68 trading between 1652.30 and 1667.78 with a positive bias.
Dr. Copper is at 3.50 up from 3.47 earlier.
Earlier the USD melted down from 81.49 to 81.30 and is currently at 81.46.
** RRR = Risk Reward Ratio
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Written by Gary